Late last month, when Elon Musk was busy doing the same things he’s doing right now — namely, tweeting about cryptocurrencies — I suggested we were witnessing the early stages of the evolution outlined in “Gods.”
In that linked article, I wrote that “the exponential nature of wealth creation in a modern capitalist system” will likely mean that “a few fortunes will become so large, so fast, that the people associated with them will become gods,” beholden to no one — not regulators, not presidents, not nations.
Musk has made more than $25 billion on paper in the last six weeks. To reiterate: $25 billion in six weeks.
Musk’s move to put Bitcoin on Tesla’s balance sheet combined with his demonstrable capacity to move the price simply by tweeting about it (or merely by appending a Bitcoin symbol to his Twitter profile), means that accounting constraints notwithstanding, he can effectively move the “value” of the company’s “cash” position.
Accountants will quibble with that. I would too. But the figure (above) pretty clearly indicates that “quibbling” with Musk has been a losing proposition.
If he sells his products for Bitcoin, that opens another Pandora’s box. Namely, he can set the dollar price of a Tesla and influence the price of a dollar alternative which he accepts as payment for them.
Bitcoin neared $50,000 over the weekend. Proponents have pointed to all manner of other news flow (see here), but the bottom line is that Musk has played an outsized role in driving recent price action.
And it’s not just Bitcoin. Musk has, of course, also dabbled in pushing around the “value” of Dogecoin, a digital joke asset in the truest sense of the word “joke.”
The gyrations in the chart (above) are largely attributable to Musk, who, in addition to tweeting out Photoshopped images promoting the coin (prompting celebrities to follow suit), claimed to have bought some for his child.
On Sunday, he took things a step further. “If major Dogecoin holders sell most of their coins, it will get my full support,” he said, in a tweet. “Too much concentration is the only real issue in my opinion.”
In my opinion, that’s not the “only real issue.” The “real issue” is that Dogecoin isn’t a real thing. It’s a joke. But maybe not. Not when the richest person on the planet decides, unilaterally, that it’s real.
Fast forward 11 hours, and Musk took it up another notch still, tweeting that, “I will literally pay actual $ if they just void their accounts.”
To be clear, this isn’t an article about Dogecoin. I don’t care about the specifics of Dogecoin. What’s notable is that Musk has now gone beyond merely pushing around the “value” of what has, in essence, become a plaything of his. Now, he’s looking to influence the actual “fundamentals” (if that’s the right word), while simultaneously admitting (accidentally or not) that the entire charade is just that — a charade.
When you have to specify that you’re willing to “pay actual $,” the tacit suggestion is that what you’re alluding to isn’t worth any “actual $.” Otherwise you wouldn’t have to be so explicit about it.
Before anyone makes this point, let me preempt readers: I understand he’s referencing something specific and unique to cryptocurrencies. However, it’s hard to ignore the absurdity inherent in the language he had to employ. While acknowledging that this comparison is apples to oranges, one wouldn’t go to a Toyota dealership, walk up to a salesperson, and declare “I will literally pay actual $ for one of these cars.”
That makes for a nice segue. Musk wants to sell Teslas in Bitcoin. He has $1.5 billion in Bitcoin on the balance sheet. He’s proven his capacity to move the price of Bitcoin. Now, he’s seemingly alluding to some kind of scheme to alter the dynamics of a Shiba Inu-themed digital token. Which his toddler owns. And which he’s also proved capable of influencing.
This is a parody of a parody of a parody. Or maybe it’s not. And that’s the problem. When you command nearly $200 billion, you can do anything you want.
For example, over the weekend, Musk invited Vladimir Putin to chat with him on the audio app Clubhouse (which is becoming more popular by the day).
An apparently bemused Dmitry Peskov called the idea “interesting.” “First we want to figure it out,” Peskov said, adding that,
President Putin does not directly use social networks, he personally does not run them. In general, this is a very interesting proposal, but one must first understand what is meant, what is proposed.
You have to laugh. The Kremlin is just as bewildered by Musk as everyone else. We’re all asking the same question as Peskov. When Musk tweets, the entire world essentially responds just as the Kremlin did Monday: “In general, this is very interesting, but one must first understand what is meant.”
While rich people conversing with controversial world leaders isn’t anything new, I wonder whether it’s advisable from a national security perspective, for Musk to be setting up freewheeling chats with the most dangerous man on planet Earth.
All of this speaks to my pseudo-warning from August about the extent to which Musk (and Bezos and Zuckerberg) are poised to become unaccountable demigods.
The irony is, the only person in the world who’s probably richer than Elon is Putin. Maybe they can chat about that on Clubhouse.